Ontario Launches Used Tire Program

November 1, 2009

TORONTO, Ont. - The Province of Ontario has launched an ambitious tire stewardship program which will ultimately clean up massive stockpiles of tires from landfill sites and direct all future scrap ti...

November 1, 2009
by
James Menzies

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PAY NOW, SAVE LATER: New tires purchased in Ontario will cost more, but the disposal fee will be waived.

TORONTO, Ont. –The Province of Ontario has launched an ambitious tire stewardship program which will ultimately clean up massive stockpiles of tires from landfill sites and direct all future scrap tires to recyclers where they’ll be converted to useful items such as car parts, mulch and playground surfaces.

The Ontario Used Tire program went into effect Sept. 1, and has several implications for the trucking industry. For starters, manufacturers, importers and retailers will serve as ‘stewards’ of the program, and will have to pay a $14.65 fee for every commercial truck tire sold in Ontario. That fee will be used to fund the program, including the collection and delivery of scrap tires to processing

plants. This has already posed some challenges for equipment dealers, points out Mark Diamantopoulos, vice-president of sales and marketing with Wabash Canada.

Since it typically takes 60-75 days for Wabash to build a trailer, the company provided quotes before the fee was imposed and now its salespeople are in the unenviable position of having to ask customers to pony up another $160 or so in tire fees at the time of delivery.

It’s not a lot of money, Diamantopoulos admitted, but the company is receiving some pushback as many of its customers are not yet aware of the new program.

The lack of awareness about the program remains an issue, Andrew Horsman, executive director of Ontario Tire Stewardship (administrator of the program) acknowledged to Truck News. He said his organization will be launching an awareness campaign so that customers understand why the fee is being collected. Just how the stewards choose to collect the fee is up to them, he said.

“The responsibility to pay the fee is imposed on the stewards, how they manage that fee through the supply chain isn’t something we have control over,” he said. “That fee in many cases may be passed on as a separate line item or integrated into the price of the tire.”

But before truck and trailer operators get their backs up at the prospect of yet another environmental fee, there are some savings available as well under the new program. If you take your scrap tires to a registered collector, for instance, there will be no disposal fee, Horsman explained.

“Based on our analysis, the average disposal cost for a medium truck tire was between $8 and $11 per tire, so what we have done is when the tire gets changed if you’re dealing with a registered collector you won’t be paying any disposal fee,” he explained. “The disposal fee piece is really critical, that’s where there’s a real savings.”

Horsman is also hopeful trucking companies will continue to retread when possible, noting the fee for new tires will not be applied to retreads.

For tire retailers and dealers, participation in the program as a collector is voluntary. Dealers that choose not to participate can still legally charge a disposal fee, Horsman warns, so it’s a good idea to look up participating collectors on the program’s Web site at www.ontariots.ca.

The voluntary nature of the collector side of the program causes Diamantopoulos some concerns about whether all suppliers will be playing by the same rules.

“It will be interesting to see how they regulate this,” he said, with some skepticism. “It’s good for the environment, as long as it’s monitored the right way and the funds go to the correct facilities to do this and there are no loopholes where ‘little Johnny’ doesn’t have to pay for it but everyone else does.”

He’s also worried about how the program will play out between jurisdictions, some of which have their own such programs already in place. In Wabash’s case the company will have to pass the new fee on to its Ontario-based customers, yet a customer in the Maritimes will be exempted, and he questions whether that’s fair?

There are other challenges posed by a mobile industry such as trucking as well. If an East Coast-based fleet has a blow-out in Ontario, will they have to pay the stewardship fee on a replacement tire?

The short answer is “Yes,” according to Horsman. The fee will be applied to all tires sold in Ontario. But what about border regions? Can a trucking company in Northwestern Ontario purchase its tires in Manitoba to avoid paying the fee and then dispose of them here free of charge?

“There’s potentially a bit of an issue at border areas,” acknowledged Horsman. “All of those areas (neighbouring jurisdictions) have managed tire programs, just not the same aggressive approach to commercial truck tires that we have. The fees are different, how are we going to manage that? We’ll be working with the other jurisdictions.”

He went on to explain that the program will be monitoring registered collectors to determine where the tires are coming from and they will be audited to ensure there’s a balance of incoming and outgoing tires.

“In a situation where a dealer is changing tires and we look at the inventory and they changed 200 tires and they have 700 scrap tires, we’re going to raise some questions,” he said. “Registered collectors need to provided proof those tires come from Ontario.”

Despite the operational hurdles, nobody would suggest the program lacks merit. Not only will the program clean up the province’s stockpile of some 2.8 million scrap tires currently occupying landfill sites, it will also ensure most of the 11 million on-road scrap tires generated in Ontario each year are recycled.

“Ontario’s used tires program marks the most ambitious used tire program in the country,” Horsman said. “The program will remove tire stockpiles, recycle tires into household, commercial and automotive products, and create green jobs and economic benefits right here in our province.”

For the first year of the program, some of the tires will be trucked to recycling facilities in the US, but by next year Horsman said he expects Ontario processing facilities will have the capacity to handle all the tires collected under the program. There are currently 10 tire recycling facilities in Ontario with more expected to come on-stream, creating new ‘green’ jobs within the province.

There are also opportunities for trucking companies that wish to participate in the program as registered haulers. They can find out how to do so by visiting the program’s Web site.